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Lost innocence for start-ups at a flashier SXSWi?

Annual geek-culture confab has gotten so big that wide-eyed young start-ups thinking it's their ticket to fame may find it's like hoping to get a record deal by showing up at Coachella with a guitar.

I woke up on Monday morning to about two dozen text messages, and none of them were really for me.

Rather, they all came from two separate group messaging accounts set up through a start-up called GroupMe, both of which had been created in the prior few days specifically to corral people before the annual South by Southwest Interactive Festival--part of the broader South by Southwest music and film festival--kicks off Friday in Austin, Texas. One was a posse of New Yorkers trying to coordinate carpools to and from their Thursday and Friday flights. The other was a group of San Franciscans setting up a "backchannel" for SXSW Interactive's notoriously labyrinthine party scene.

It's easy for me to sleep through text messages while my iPhone is set on vibrate. But the complete onslaught of pre-SXSW Interactive banter and buzz has been unavoidable--and it all promises, among other things, sleeplessness. Thanks to a combination of marketers' ongoing fascination with digital media and notably bigger budgets in the tech world in comparison to years past, SXSW Interactive--historically abbreviated as SXSWi--is going to be an order of magnitude bigger, flashier, nuttier, and drunker than it was last year. Anybody who was complaining in 2008 that it was "too big" or in 2009 that it was "too corporate" may want to pack some extra Excedrin.

"I have never seen so much hype for SXSWi," said Steve Martocci, co-founder of GroupMe, which released not one but two updates to its mobile messaging application in anticipation of heavy use at the festival. "I hope it's as much fun for people as it looks to be."

"Seriously, it's going to be a sh*tshow," Matt Galligan, founder of geolocation software company SimpleGeo, told CNET on Tuesday, using the uncensored version of the term that many a SXSWi-goer feels is the most appropriate way to encapsulate the impending chaos of the festival. "Here's the thing--so many start-ups this year. Everyone looks to it as being able to break out like Twitter and Foursquare. But they're seriously the exception to the rule. How many start-ups didn't blow up? And this year, there are many start-ups with the exact same functionality, which wasn't the case in previous years, Foursquare vs. Gowalla excepted."

Galligan can claim a small slice of that "sh*tshow" as his own: SimpleGeo is throwing a party late on Sunday night with fellow tech start-ups Twilio, SendGrid, and Apigee. There will be a DJ set, followed by a live performance by electronic rock band Innerpartysystem. The party doesn't end until 4:00 a.m., which is a good thing for SXSWi attendees whose Sunday night schedules likely also include a Diplo concert thrown by video-sharing site Vimeo in collaboration with camera-maker Nikon, a party for the eBay-owned RedLaser featuring electronic act Chromeo, a start-up party co-hosted by actor Ashton Kutcher, and a "night of drinking and debauchery" at outdoor dive The Mohawk thrown by StumbleUpon and marketing firm Barbarian Group. Those are just a few of the planned events.

You see, there are two phenomena at SXSW Interactive 2011 that are shaping up to make the conference an absolute madhouse. One is that, several years after Twitter and then Foursquare made their first big splashes at the festival, massive contingents of the digital media, marketing, and start-up sectors have made SXSWi a must-attend because it's seen as a prognosticator of the next big thing. But here's where that second phenomenon comes into play: SXSWi attendance was sky-high last year, but the recession's effects on technology were still felt all around. This year, not so much. Companies are aflush with venture cash--start-ups DailyBooth, StumbleUpon, HubSpot, Kik, and Stack Exchange all have announced funding rounds in the past few days that, when added up, reach into the nine figures. And the reported valuations of bigger companies like Facebook, Twitter, and Groupon are so high that there is talk of--you guessed it--a "bubble" in the manner of the late 1990s.

Many attendees, of course, will find the souped-up SXSWi to be loads of fun. Back in 2009, it was a big deal when Microsoft hired a local food truck to drive around offering free pizza after midnight; now, free food and drinks will be available all over town at just about all hours, as start-ups and marketers rush to sponsor taco trucks, "hangover brunches," dinners, and open-bar parties. Both CNN and Fast Company magazine are booking large spaces in entire restaurants as sponsored "grills" throughout the week--and should transportation from a sponsored dinner at the Fogo de Chao steakhouse happen to be too much of a walk from that night's open-bar party at The Mohawk, plenty of companies this year have opted to offer sponsored transportation, whether it be taxis, shuttles, or rickshaw-like pedicabs.

But the losers in this situation, unfortunately, may be the small start-ups themselves that see SXSWi as a make-it-or-break-it opportunity for exposure and enthusiasm. There are so many launches at the festival this year (many of them unofficial) that trying to push through the noise may be futile. Entrepreneurial types who campaigned heavily on Twitter and Facebook to have their proposals for SXSWi panels voted into the festival may be disappointed to find their audiences drawn away from the Austin Convention Center, the main hub of the conference, by a plethora of unofficial panels, brunches, poolside parties, and other daytime activities.

One SXSWi event planner said that she thinks the average festival attendee will still find things relatively manageable. Emily Gannett of marketing firm IRL Productions is coordinating a poolside barbecue for toolbar and app maker Conduit, a midday reception sponsored by PepsiCo (a ubiquitous SXSWi marketing presence), and the late-night concert thrown by Nikon and Vimeo, as well as a series of morning workouts for fitness-minded attendees.

"Most likely, I won't be sleeping," Gannett said of her hectic schedule, but said she thinks that's typical only of SXSWi's most hyper-networked attendees. There are thousands of others who are newer to the festival or not as tapped-in to the latest goings-on in the tech scene. "Most of the activities on my calendar are parties or unofficial events, maybe one official panel...Not everyone's calendar looks like that. I would say we (the invitation-swamped uber-digerati) know about all the events and parties because we're in the scene, or in my case are producing events). My guess is that most brand marketers attending the conference are planning on attending one or two events an evening." A far more manageable schedule indeed.

But there's still a chance that the unprecedented frenzy will flood all corners of the Austin Convention Center and every bar on Sixth Street, and the wide-eyed entrepreneurs hoping they'll pick up hundreds of thousands of new users will fly home from Austin disheartened rather than invigorated. After this year, using SXSWi as an unofficial springboard for new social-media products may look far less appealing, and that will unquestionably change the mood of the festival next year.

"I can't imagine a worse place to launch a start-up this weekend. Too much noise," entrepreneur Anil Dash, who is not going to SXSWi, posted to his Twitter account late on Wednesday. "You don't want to seem like just another contender in a town full of pitches. You want to stand out."